Dell CEO Appears to Have Votes for $25 Billion Buyout Bid

Icahn raged against the delays and changes and tried to sue to keep the deal from going through. However, a Delaware court ruled against his efforts to expedite the suit, and on Sept. 9, Icahn sent a letter to shareholders saying he was giving up the chase. However, he still said he believes the amount of the deal is too low and that actions by Michael Dell and the company’s board were unfair.
“Even in a dictatorship when the ruling party loses an election, and then ignores its outcome, it attempts to provide a plausible reason to justify their actions,” Icahn wrote. “But the Dell board felt they needed no excuse when they changed the voting standard and changed the record date of those eligible to vote, which allowed arbitrageurs to vote a much greater percentage of the stock when the polls reopen and scheduled the annual meeting for October. The board simply relied on the usual ‘business judgment’ catchall and Delaware law to uphold their actions. We jokingly ask, ‘What’s the difference between Dell and a dictatorship?’ The answer: Most functioning dictatorships only need to postpone the vote once to win.”
Like many other established tech vendors, Dell has been hammered by the rapid decline in worldwide PC sales. In the second quarter, Dell saw profits drop 72 percent even though revenues grew slightly, with PC revenues falling 5 percent.
Dell executives for several years have been trying to remake the company into an enterprise IT solutions and services provider. Michael Dell has argued that they would be able to accelerate their efforts if Dell were a private company that no longer had to answer to the short-term demands of Wall Street and its analysts.

In his letter, Icahn said he was disappointed that he didn’t win the tug-of-war with Michael Dell, though he was pleased the struggle resulted in a better price. He also noted that the CEO and Silver Lake “waged a hard fought battle.”

“We therefore congratulate Michael Dell and I intend to call him to wish him good luck (he may need it),” Icahn wrote.